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This $7 Million Donation Signals The California Governor's Race Is Ready To Rumble

Andrew Nixon / Capital Public Radio

The California State Capitol on September 12, 2017.

Andrew Nixon / Capital Public Radio

The California governor’s race is heating up just weeks before vote-by-mail ballots go out for the June 5 primary, with two giant donations the first sign that the big money is starting to move.

Netflix CEO Reed Hastings gave $7 million on Wednesday to an independent expenditure committee run by the California Charter Schools Association — in support of former Los Angeles Mayor Antonio Villaraigosa. Billionaire philanthropist Eli Broad chipped in another $1.5 million on Thursday.

“It’s the first major outside expenditure that you’re seeing,” says Rob Pyers with the California Target Book, which tracks political races in the state.

Although the maximum individual donation that can be made directly to a gubernatorial campaign this election cycle is $29,200, there are no such limits for independent expenditure committees.

“A donor can write a $7 million check to an outside group, and so long as they don’t coordinate with the campaign, they’re permitted to spend the money however they want, essentially,“ Pyers says. “So, that makes up a huge difference in media buys and mailings and things like that.”

The Charter Schools Association declined comment about the donations, choosing instead to issue a brief statement praising Villaraigosa.

The only other outside spending in the race so far has come in small chunks — from the California Nurses Association for Lt. Gov. Gavin Newsom, and from the Asian American Small Business PAC against Newsom.

But more money will surely flow in the coming weeks, on multiple fronts.

Newsom, who consistently leads both public and private polls,  has the support of nearly every influential union in the state — including the California Teachers Association, Service Employees International Union, and California Nurses Association.

His latest boost came Thursday with an endorsement from the California Labor Federation, which represents both public and private sector unions.

The Charter Schools Association, meanwhile, is joining forces with another outside group backing Villaraigosa run by a former top aide to President Obama, Bill Burton. Former Assembly Speaker John Pérez, Villaraigosa's cousin, is also involved in the Burton group's effort.

Newsom and Villaraigosa are both Democrats.

Polls show Villaraigosa in the pack of candidates — including Republicans — vying for second place, behind Newsom. The top two June primary finishers, regardless of political party, advance to the November election.

Besides the polls, Newsom has raised the most money — more than $23 million so far spread across two campaign accounts.

Democratic state Treasurer John Chiang and Villaraigosa are a tier below Newsom in fundraising, along with Republican San Diego businessman John Cox, who's ponied up $4 million from his personal fortune. GOP Assemblyman Travis Allen and former state schools chief Delaine Eastin lag behind in both polls and fundraising.

Newsom has “had a bit of a head start, and he’s had a sizeable money advantage over his opponents,“ Pyers says. “But as you can see with the outside expenditures, that can be wiped out with a stroke of a pen.“

The unions are expected to fund independent expenditures in support of Newsom — and also work to boost a Republican candidate in hopes of blocking Villaraigosa from joining Newsom in the November general election.

Villaraigosa's backers, meanwhile, will seek to ensure he advances to the November election by propping him up and attacking his rivals.

Chiang, Cox, and Republican interests will surely be active as well.

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